In Re D. Wilson Const. Co.

196 S.W.3d 774
CourtTexas Supreme Court
DecidedJune 30, 2006
Docket05-0326
StatusPublished
Cited by540 cases

This text of 196 S.W.3d 774 (In Re D. Wilson Const. Co.) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re D. Wilson Const. Co., 196 S.W.3d 774 (Tex. 2006).

Opinion

196 S.W.3d 774 (2006)

In re D. WILSON CONSTRUCTION COMPANY, et al., Relators
American Standard and the Trane Company, et al., Petitioners,
v.
Brownsville Independent School District, Respondent.

No. 05-0326, 05-0327.

Supreme Court of Texas.

Argued February 14, 2006.
Decided June 30, 2006.

*776 John R. Griffith, Lucia Thompson, Paul W. Gertz, Mark T. Beaman, David E. Little, Fred L. Shuchart, David P. Benjamin, *777 Cindy A. Lopez Garcia, Albert M. Gutierrez, Jr., Margery Huston, Rick Fancher, Rob Martin, Robert A. Skipworth, Ewing Edben Sikes, III, for relator.

Ernesto Gamez, Jr., Ramon Garcia, Baltazar Salazar, Catherine W. Smith, for real party in interest.

William K. Luyties, Paul Goldenberg, Moises R. Hernandez, James H. Powell, Jr., for person interested in case.

Justice WILLETT delivered the opinion of the Court, in which Chief Justice JEFFERSON, Justice HECHT, Justice O'NEILL, Justice WAINWRIGHT, Justice MEDINA, Justice GREEN, and Justice JOHNSON joined.

In this consolidated proceeding, we decide whether the court of appeals had jurisdiction over an interlocutory appeal under the Texas Arbitration Act and whether the parties' arbitration agreements are ambiguous. We hold that the court of appeals had jurisdiction over the interlocutory appeal and that the agreements are not ambiguous.

I. Background

In 1993, the Brownsville Independent School District contracted with two general contractors, D. Wilson Construction Company and Stotler Construction Company, to build two schools in Brownsville. Both contracts incorporate General Conditions and Supplementary Conditions.

The General Conditions expressly incorporate AIA Document A201, a standard construction industry document published by the American Institute of Architects that details the parties' respective rights, responsibilities and relationships on the project.[1] Paragraph 4.5 of A201 is titled "Arbitration," and subparagraph 4.5.1, titled "Controversies and Claims Subject to Arbitration," sets forth the broad, catch-all scope of the arbitration agreement: "Any controversy or Claim arising out of or related to the Contract, or the breach thereof, shall be settled by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association . . . ."

The Supplementary Conditions state that they "modify, change, delete from or add to" the General Conditions. Among other things, the Supplementary Conditions "[a]dd new Clause 4.5.1.1" to the arbitration provision: "Except as otherwise provided in this Contract, any dispute concerning a question of fact arising under this contract, which is not disposed of by agreement shall be decided by [BISD].... The decision of [BISD] shall be final and conclusive unless" it is timely appealed to the Superintendent and then to the BISD Board of Trustees, "whose decision shall be final and conclusive."

*778 This litigation began when one of the subcontractors, American Standard and the Trane Company (Trane), sought injunctive relief against BISD to preserve evidence in a personal injury action that students and teachers brought against Trane in another court. BISD counterclaimed for alleged defects in the construction of the two schools and filed third-party actions against several parties, including general contractors Wilson and Stotler, as well as subcontractors and second-tier subcontractors. Trane and the third-party defendants filed or joined motions to compel arbitration under the Federal Arbitration Act, 9 U.S.C. §§ 1-16, and the Texas Arbitration Act, TEX. CIV. PRAC. & REM. CODE§§ 171.001-.098.[2] After a hearing, the trial court issued a brief letter ruling denying arbitration, saying "the Court finds the contract in question ambiguous." Trane and the third-party defendants filed both a petition for writ of mandamus under the FAA and an interlocutory appeal under the TAA, and the court of appeals consolidated the two proceedings. Nos. 13-04-184-CV, 13-04-333-CV, 2005 WL 310777, at *1 (citing In re Valero Energy Corp., 968 S.W.2d 916, 916-17 (Tex.1998)). The court of appeals dismissed the interlocutory appeal for want of jurisdiction, finding the TAA inapplicable since the dispute concerned a "`transaction involving commerce.'" Id. at 2005 WL 310777, at *2 (quoting In re MONY Sec. Corp., 83 S.W.3d 279, 282-83 (Tex.App.—Corpus Christi 2002, consolidated appeal and orig. proceeding)). The court also denied the petition for writ of mandamus, holding that clause 4.5.1.1 in the Supplementary Conditions creates ambiguity. Id. at 2005 WL 310777, at *3. In this appeal, Trane and the third-party defendants complain that (1) the court of appeals erred in dismissing their interlocutory appeal under the TAA for want of jurisdiction, and (2) the trial court erred in deeming the arbitration agreements ambiguous and abused its discretion in denying their motions to compel arbitration.

II. Jurisdiction of the Court of Appeals

Trane and the third-party defendants first argue that the court of appeals erred in dismissing their TAA-based interlocutory appeal for want of jurisdiction. We agree.[3]

The contracts in question reference neither the FAA nor TAA, merely noting that "[t]he Contracts shall be governed by the law of the place where the Project is located." We have interpreted identical language *779 to invoke federal and state law. In re L & L Kempwood Assocs., L.P., 9 S.W.3d 125, 127-28 (Tex.1999) (per curiam) (consolidated appeal and orig. proceeding). Trane and the third-party defendants sought relief under both statutes in the court of appeals, bringing a petition for writ of mandamus under the FAA, see Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 272-73 (Tex.1992), and an interlocutory appeal under the TAA, TEX. CIV. PRAC. & REM. CODE § 171.098(a)(1).

While refusing jurisdiction under the TAA, the court of appeals recognized that it at least had jurisdiction under the FAA to consider the mandamus petition. 2005 WL 310777, at *2. We held in Jack B. Anglin Co. that mandamus is appropriate to review a trial court's denial of a motion to compel arbitration under the FAA. 842 S.W.2d at 272-73.

The court of appeals determined that it lacked jurisdiction over the interlocutory appeal under the TAA because the construction contracts involved interstate commerce, thus implicating the FAA. 2005 WL 310777, at *2; see Perry v. Thomas, 482 U.S. 483, 489, 107 S.Ct. 2520, 96 L.Ed.2d 426 (1987) (the FAA applies when the dispute concerns a "contract evidencing interstate commerce"); 9 U.S.C. § 1 ("`commerce' . . . means commerce among the several States"); In re L & L Kempwood Assocs., L.P., 9 S.W.3d at 127 (noting that the FAA "extends to any contract affecting commerce, as far as the Commerce Clause of the United States Constitution will reach").

The court of appeals is not alone in dismissing interlocutory appeals under the TAA when the FAA applies. See Kroupa v. Casey, Nos. 01-05-00224-CV, 01-05-00376-CV, 2005 WL 3315279, at *4 (Tex.App.—Houston [1st Dist.] 2005, consolidated appeal and orig. proceeding) (not designated for publication); Am.

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Bluebook (online)
196 S.W.3d 774, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-d-wilson-const-co-tex-2006.